AICPA Asks IRS for Tax Leniency

By Ken Berry

It's not quite as dramatic as the attorney for a death row prisoner requesting a reprieve from the governor, but the American Institute of CPAs (AICPA) has sent a letter to the IRS asking for relief in the 2012 tax filing season.
 
The three-page letter, directed to Steven T. Miller, acting commissioner of the IRS, is in response to an IRS announcement released on January 31. Initially, the IRS listed thirty-one tax forms that would be delayed, reduced to twenty-nine since then, according to Benson Goldstein, a senior technical manager with the AICPA. He acknowledged the administrative challenges faced by the IRS in updating its systems due to the new legislation enacted around the turn of the year, but the AICPA still has concerns about the burdens being shouldered by tax filers and tax practitioners. 
 
It could take until early March for the IRS to make all the necessary revisions, says Goldstein. The compressed time frame could cause problems for filers. "We are concerned that the delay will have a tremendous impact on both business and individual taxpayers," he told AccountingWEB. 
 
Goldstein says the missive should be viewed as part of the ongoing dialogue between his organization and the IRS. "We are in constant contact with the IRS regarding such concerns," he said. 
 
Goldstein noted that the purpose of the letter was twofold. "First, it reminds the IRS that the delays cause disruptions to an efficient work stream. Second, it shows how it affects the ability to file returns." He pointed out that the letter specifically urges the IRS to take the following three steps:
 
1. Failure-to-file and failure-to-pay penalties. There may be instances where form delays contribute to late filings and/or payments. Despite the availability of "reasonable cause" relief from assessment of these penalties, the AICPA is finding it more difficult for taxpayers to establish grounds that will be accepted by the IRS. At a minimum, it asks the IRS to instruct its examiners to more readily accept grounds for reasonable cause relief relating to these delays.
 
2. Estimated tax penalty relief. Similar to the situation concerning the other penalties, the AICPA is asking the IRS to consider granting a waiver from estimated tax penalties due to the challenges faced by taxpayers this tax filing season.
 
3. More clarity in the release of tax forms. The AICPA also believes the IRS would benefit in the future from closer consultation with the AICPA and other stakeholders about plans with respect to the timing of form releases. 
 
What happens next? The AICPA will wait to see how the IRS responds. In the meantime, Goldstein stresses that the dialogue over what's in the best interests of the taxpayers and the professional community will continue.
 
Related articles:
 

You may like these other stories...

Camp Hopes Estate Tax Will Be on Its Way OutAn article in Bloomberg said that Republicans are considering voting this year to repeal the U.S. estate tax, according to House Ways and Means Chairman Dave Camp (R.-Mich.). He...
Senate Takes Different Approach from House for Highway and Bridge FundEarlier this week, according to a New York Times article, the Senate agreed to fill the coffers of the fund that pays for highway and bridge repairs with...
There it stands, your client's 100-year-old, rickety, vermin-infested barn or former hotel or whatever the darn thing once was. And she's considering what to do with it. There are two words that can help her decide...

Upcoming CPE Webinars

Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.
Aug 20
In this session we'll review best practices for how to generate interest in your firm’s services.
Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.
Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.